Ellie Mae: Refinances Soar as 30-Year Note Rate Declines
MBA NewsLink Staff
Ellie Mae, Pleasanton, Calif., said drops in 30-year interest rates for the eighth consecutive month drove up the percentage of refinances in August.
The company's monthly Origination Insight Report said with the 30-year rate at 4.07 percent in August, down from 4.18 percent in July, spurred refinances to 43 percent of all loans, up from 38 percent the month prior. Purchase percentages as a share of all loans fell under 60 percent for the first time in 2019.
The report said closing rates also rose for all loans, to 77.3 percent, up from 77.0 percent in July. Closing rates on purchases increased to 80.0 percent in August, up from 79.3 percent in July, while closing rates on refinances dropped slightly to 72.5 percent in August, down from 72.9 percent the month prior.
Time to close all loans held steady at 42 days in August. The time to close a refinance loan decreased to 39 days, down from 40 days the month prior, while the time to close a purchase loan increased from 43 days in July to 45 days in August.
"Interest rates continue to decline and we're seeing homeowners capitalize on the refinance opportunity throughout the month of August," said Jonathan Corr, president and CEO of Ellie Mae. "As we enter the fall and the market expects further rate cuts from the Fed, we will watch to see if the share of refinances continues to climb further."